How Seattle Transformed Over the Last Decade
As we enter 2020, it’s time to look back at how Seattle has changed over the last decade. Our city has undergone a decade of explosive growth, and with it, some incredible changes. The tech scene is booming, jobs are plentiful, and the Sounders are MLS champions once again. Other changes have not been so positive for the city. The bustling job market has brought approximately 150,000 new residents to Seattle and lots of congestion. Scarcity of land and an influx of new developments have made housing and rents soar, as well as homelessness.
Perhaps nothing has influenced Seattle’s transformation more than the meteoric rise of Amazon. At the turn of the decade in 2010, Amazon was worth only $50 Billion. Today, it is worth $925 Billion and is the largest internet company by revenue and the second-largest private employer. The growth of Amazon in Seattle’s South Lake Union completely changed the face of that neighborhood and the Seattle housing market.
As we enter a new decade, filled with hope, optimism, and gratitude, let’s take a few minutes to reflect on the Seattle of yesteryear and what these changes might mean for us in the next decade.
The Great Recession
It’s necessary to understand what Seattle was at the start of the decade to follow Seattle’s current market climate. Back in 2010, Seattle was not the booming metropolis that it is today.
According to the US Census, Seattle had just over 600,000 people in 2010. The median home price was around $375,000. Seattle’s most prominent tech and e-commerce company, Amazon, had only 5,000 employees. Rent prices in Seattle were also pretty affordable at less than $1,000 for a 1-bedroom apartment and less than $1,500 for a 2-bedroom one. Although Seattle was well-known in people’s minds (who could forget Dr. Frasier Crane), it wasn’t the hotspot that it is now.
Surrounding cities like Kent, Issaquah, and Bothell, were considered somewhat remote, and there wasn’t nearly the same number of commuters from the eastside coming into the city each day. The housing market in the Pacific Northwest was still reeling from the Great Recession and wouldn’t bottom out until 2011. While Microsoft was a behemoth, it wasn’t bringing people here in droves.
South Lake Union was a quaint neighborhood that contained warehouses, single-family homes, and furniture stores. Other parts of the city were similar. Seattle was smaller, more compact, and easier to navigate. The city’s homeless population was comparatively low at 2,759 unsheltered people.
Chart from NWMLS’ InfoSparks showing median residential home sale price for City of Seattle
The Economy Starts to Pick Up
In 2012, things started to pick up for the region. Amazon had tripled its stock price and market cap. Microsoft got a new CEO, which re-energized the company significantly and boosted its stock price.
Amazon started hiring significantly more employees. Between 2010 to 2012, Amazon more than doubled its workforce in Seattle from 5,000 to 12,000 employees. By the end of 2015, Amazon was building more offices in South Lake Union to support all these workers. Amazon’s AWS was firmly entrenched as the leader in the cloud computing space.
Housing prices followed suit. By 2015, Seattle’s median home price had climbed 53% from the lows in early 2012. Rent prices also went up, with one and two-bedroom apartments costing approximately 50% more by the end of 2015 as they had at the start of 2012. Perhaps not surprisingly, homelessness also went up, with 1,000 more unsheltered people than in 2010.
Seattle (and Its Housing Market) Take Off
Between 2015 and 2019, Seattle saw exponential growth. Amazon has tripled its workforce in the last four years and now has over 50,000 employees in Seattle alone. Amazon’s presence in the downtown area is more massive than the next 40 biggest employers in the city combined. It also occupies 19% of all prime office space in Seattle, the most of any employer in a major US city. Microsoft also saw explosive growth as well, vaulting from a $250 billion company to over $1.2 trillion at the end of 2019. Let’s not forget the companies Amazon has gobbled up – Twitch, Audible, Whole Foods and the Washington post, to name a few.
South Lake Union is now home to a plethora of big tech offices, including Facebook, Google, and Uber. The larger Puget Sound area is bustling with business headquarters for companies in software, biotech, fintech – even dog-walking app Rover. In 2019, Seattle was voted best city for startups by Business Insider.
In the real estate realm, startups Zillow and Redfin are two Seattle companies that have virtually changed the way people buy and sell real estate. Now, consumers don’t need a real estate agent in order to view what properties are available on the MLS. They can also sell their home with Redfin for a lesser fee than what standard brokerages charge.
Home prices have nearly doubled in four years from their 2015 levels. The median home price in Seattle is around $725,000 now. Over the past decade, the average rent price has doubled as well, to nearly $2,000 for a 1-bedroom apartment. During this 2015-2019 period, Seattle lost any feeling of being a smaller city and is now one of the top 20 most populous cities in the US. Seattle had some of the highest population growth in the middle of the decade, with 160,000 people moving to Seattle city between 2010 and 2018 (16,000 people per year on average or 43 people per day).
The greater Seattle metropolitan area, which includes cities like Bellevue and Renton, has increased by 12% over the past decade. Much of that explosive growth is thanks to the good business economy, mild climate and access to outdoor activities nearby.
High Housing Prices Makes Affordability Tough
One of the unique things about Seattle is its total land area is small. Like San Francisco, we suffer from a lack of developable space and since we’re surrounded by water on both sides, there isn’t much area to expand to. This has led to the rather extreme uptick in housing costs and rush to develop and upzone parts of the city.
Over the past decade, rents have doubled and quickly grown unaffordable for people, which has pushed them out of the downtown area and eclectic neighborhoods such as Capitol Hill and Queen Anne. By contrast, across the United States as a whole, rent has gone up only 30% during the previous decade. That level of increase is approximately 2.7% per year, which is about equal to that of the average inflation during this decade.
As you might expect, most of the expensive neighborhoods for rent are the ones near the tech hubs. Capitol Hill, Downtown, South Lake Union, and Westlake all lead the way for the most expensive average rents. Seattle also has the smallest average apartment size of all the big cities in the United States. The average square footage was 690 sq. ft. meaning Seattleites pay more money for less space than pretty much any other metro area in the country.
Due to the small apartment sizes and the relative unaffordability of space within the city limits, affordable housing is a highly talked about topic in Seattle. The new mayor, Jenny Durkan, unveiled multiple proposals during this year to combat the crisis. One of the biggest changes this year was the upzoning of 27 neighborhoods and expansion of urban village zones. Seattle also eased ADU rules, with the hopes that people will build more backyard units and add “gentle density” without disrupting the character of existing neighborhoods.
King County and the City of Seattle have teamed up to create a new Regional Homeless Authority. The city also recently announced a record $110 million investment to combat homelessness. Hopefully, these and other changes will help this crisis in the coming decade.
Transportation Infrastructure Improves
During the previous decade, the sheer quantity of people moving to this area caused gridlock and congestion on the roads. In response to this, Seattle invested heavily in transportation options, but we still have a long way to go.
The most memorable transportation developments were the SR-99 Tunnel that replaced the Alaskan Way Viaduct, and the expansion of light rail. Seattle removed the unsightly viaduct and replaced it with a much more efficient tunnel that lets motorists quickly get from south Seattle to the northern part of the city. However, the project was plagued by delays and snafus after the tunnel-boring machine “Bertha” ran into steel pipes and caused sinkholes. Construction that was supposed to last 14 months ended up taking almost four years. Amazingly, the project got finished and the tunnel is now open to the public as a tolled road.
The city has also invested heavily in eco-friendly transportation. Link light rail, which opened in 2009 and took passengers between downtown and Sea-Tac International Airport, is still expanding. In 2016, the light rail expanded to Capitol Hill and Husky Stadium. Three more stops are slated to open in 2021 ending at Northgate. The Northgate stop is expected to reinvigorate that neighborhood, along with the upcoming NHL training rinks.
King County has also started using electric busses and plans to have an emissions-free fleet no later than 2040. Both the county and city have been actively promoting alternative forms of transportation, as well as those immediately recognizable green lime bikes and electric scooters. Despite the constant rain and steep hills, Seattle continues to be a bike-friendly city.
Quality of Life Remains High but Could Be Improved
Seattleites enjoy one of the highest qualities of life in the United States. There are excellent schools and hospitals within our city limits and lots of parks for kids (and dogs). Washington has the best economy in the United States, enabling families of all walks of life to enjoy the unparalleled opportunity that this region brings.
However, the last decade has brought decreases in quality of life as well. With Seattle experiencing such an enormous population boom, traffic here worsened. A recent study showed that Seattle has the second-worst commute in the nation. While there’s no question that Seattle is currently behind other developed east coast cities, the addition of light rail, buses, streetcars, and other traffic enhancements should help ease this problem in the future. Many of these improvements are in progress, so residents should see better commutes in the next two or three years.
Of course, there is also a homeless crisis. With all the displaced persons due to high rents, property taxes, and housing prices, the homeless population has ballooned in the city. As discussed previously, both King Country and the city of Seattle have plans to expand affordable housing investments. Since many of these investments started this year, we should start to see improvements in this area.
How Will Seattle Change In The Next Decade?
As we wind down 2019 and enter 2020, it’s worth pondering about what the next decade will bring for the Emerald City. While it’s impossible to say definitively, it would be a safe bet that the current tech boom will continue to have ripple effects on the city. Amazon, Microsoft, Google, Facebook, and Uber all show no signs of slowing down. These lucrative jobs support robust housing and rental markets. If these companies continue their acquisition of new employees, housing in this region will always be in demand. It’s unlikely that property prices will collapse too suddenly. If anything, they’ll likely continue to be stable as the new decade progresses.
In terms of quality of life for residents, sadly, the picture is a little more of a mixed bag. Congestion and high housing costs will likely continue to be hot-topic issues. While the expansion of the light-rail system may solve some of these problems, the reality is that traffic in Seattle will only get worse with more residents and some developments are still years away.
Overall, it’s safe to say that the future looks bright for the city. There were undoubtedly issues caused by growth during the past decade. However, the city has been remarkably good about creating comprehensive plans to address those in the 2020s. With these plans in place, Seattle will continue to be a beacon of innovation and growth in the US.
If you’re interested to see what the future holds, check out the Puget Sound Regional Council’s 2050 Draft Report.
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